Shares of footwear marketer and retailer Stride Rite (NYSE:SRR) are bumping up against their highs for the year after a couple of decent quarters of sales and earnings growth. Too bad the track record isn't as consistent, but are things finally starting to change for the better?

Sales for the quarter advanced 21% to $177.5 million and grew 22% for the nine-month period ended Aug. 31. However, if you strip out the acquisition of Saucony, an athletic-footwear firm acquired in September 2005, sales grew only in the mid-single digits and were a mixed bag by brand.

Stride Rite owns footwear brands and sells them at its own retail stores, including approximately 195 Stride Rite children's shoe stores, and at almost 70 outlet stores that sell excess, closeout, and out-of-season shoes for internal brands. These brands include Keds, Sperry, Stride Rite, Tommy Hilfiger, and the newly acquired Saucony, plus a more recent purchase of Robeez, a seller of footwear for babies and kids up to age 3. The company's other major business involves selling shoes and related accessories via wholesale channels to other retailers and department stores such as Macy's (owned by Federated (NYSE:FD)), where it also leases some children's-footwear space.

I like Stride Rite's cash flow generating ability; over the past three fiscal years, operating cash flow has exceeded reported net income by 50%-80%, while annual capital-expenditure needs (excluding acquisitions) have averaged only $7.5 million, or less than 20% of operating cash flow. Unfortunately, top-line growth has been anemic; over the past five years, sales have grown at an average of 1.4% per year. Earnings and cash flow growth have also been mostly in the single digits over that time frame.

Growth trends have improved over the past couple of years, and management appears to be pursuing acquisitions, as witnessed by the Saucony and Robeez purchases in the past year. That has helped top-line trends; time will tell whether the deals will kick-start cash flow growth.

What would really be nice to see is consistent growth from all brands. Retail Stride Rite Children's Group and the Sperry Top-Sider brand experienced solid sales growth of 17% and 15%, respectively, but Keds and Tommy Hilfiger Adult fell 12% and 36% for the quarter. I'll remain on the sidelines until I see how well management is able to integrate its new brands into the existing business, but growth does appear to be picking up at Stride Rite. In the meantime, Fools may also want to walk over and check out the competition, which includes Nike (NYSE:NKE), Skechers (NYSE:SKX), and Steve Madden (NASDAQ:SHOO).

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Fool contributor Ryan Fuhrmann is long shares of Nike but has no financial interest in any other company mentioned. Feel free to email him with feedback or to discuss any companies mentioned further. The Fool has an ironclad disclosure policy.